What does the European directive on salary transparency mean for employees and employers in Romania
The European Directive on salary transparency (EU Directive 2023/970) introduces a set of common rules at the level of the European Union which aims to reduce pay differences, especially gender differences, and increase transparency in the way salaries are determined.
Romania must transpose the Wage Transparency Directive by June 7. Archive photo
Member States, including Romania, must transpose these provisions into national legislation by June 7, 2026, when many of its obligations will become applicable in practice.
By June 7, 2026, Romania should apply EU Pay Transparency
By this deadline, Romania must adopt the legal framework through which the European directive on salary transparency becomes applicable in domestic law. From that moment, the European rules will start to be gradually implemented in the labor market.
Among the major changes are the obligation for employers to communicate from the recruitment stage the salary range or starting salary for a position, the ban on asking candidates for salary history and the right of employees to receive information about salary levels in the company, relative to positions of similar or equivalent value, according to information published by the European Council.
Also, companies of a certain size will have gender pay gap reporting obligations, and if significant unjustified differences are identified, corrective action will need to be taken with employee representatives.
What it means for companies and employees
For employers, the European directive on salary transparency means changing the way in which salary and recruitment policies are structured. Companies will need to define clear, objective and gender-neutral criteria for setting salaries and career progression, but also be prepared to justify differences in remuneration between employees performing the same work or work of equal value.
In addition, HR processes will become more formal and documented, as salary data will need to be collected and reported periodically depending on the size of the company. In certain cases, these obligations will include joint evaluations of pay systems, carried out together with employee representatives, when pay differences cannot be objectively explained.
For employees and candidates, the impact is mainly related to increased information and transparency. In recruitment, they will have access to salary ranges before signing the contract, which reduces the information asymmetry between the employee and the employer. Within the company, employees will be able to request information about their salary relative to averages for similar positions, which can help identify potential discrepancies or inequities.
At the same time, the directive strengthens the principle of equal pay, including the possibility for employees who consider themselves to be discriminated against in pay to request compensation, and for the employer to be obliged to prove that he has not violated the rules of equal treatment.
The purpose of EU Pay Transparency
The main purpose of the directive is to apply the principle more effectively “equal pay for equal work or work of equal value“, established at the European level. In practice, the European Union aims to reduce the salary gap between women and men and to eliminate situations in which the lack of transparency allows the maintenance of unjustified salary differences.
Another important objective is to increase confidence in the labor market and reduce information imbalances between employers and employees, so that decisions on wages become clearer, more coherent and easier to verify. At the same time, the directive aims to encourage fairer and more predictable pay practices in all EU member states.
